Drivers and barriers to adopting the digital euro : consumers, merchants and intermediaries’ perspectives

Abstract

The potential issuance of the digital euro has been under investigation for several years. Led by the European Central Bank, this process has involved detailed development of its planned features and functionalities. If introduced, the digital euro will arrive into a payment landscape that includes various existing methods. The study aims to identify the key drivers and barriers influencing the adoption of the digital euro from the perspectives of consumers, merchants, and intermediaries (i.e., banks in this study). Conducted as an inductive study, it employs a qualitative research approach based on five in-depth, semi-structured interviews with experts from the financial sector. The literature review presents the concepts of Central Bank Digital Currency and the digital euro, alongside the Diffusion of Innovations theory, which serves as the theoretical foundation for the analysis. Findings suggest that the perceived relative advantage of the digital euro will be a crucial factor in adoption across all stakeholder groups. While drivers and barriers were identified for each group, their significance varied. Overall, the study's results align with previous research on the topic. The practical implications emphasise the importance of effective communication, cooperation, and stakeholder engagement to facilitate the adoption process. At the time of writing this thesis, the digital euro had not been issued, so future research has possibilities. Future studies could explore the long-term impacts of digital euro adoption on financial inclusion, consumer behaviour, and payment system efficiency, as well as a narrower scope focusing on specific features of the digital euro or the impacts of user-interface design.